Is Salix Pharmaceuticals, Ltd. (SLXP) Going to Burn These Hedge Funds?
Is Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP) going to burn you?
In the 21st century investor’s toolkit, there are dozens of methods shareholders can use to monitor their holdings. A pair of the best are hedge fund and insider trading sentiment. At Insider Monkey, our research analyses have shown that, historically, those who follow the best picks of the top money managers can outpace the S&P 500 by a superb margin (see just how much).
Equally as necessary, bullish insider trading sentiment is a second way to analyze the world of equities. Obviously, there are a variety of stimuli for a bullish insider to drop shares of his or her company, but only one, very simple reason why they would behave bullishly. Many empirical studies have demonstrated the impressive potential of this tactic if "monkeys" know where to look (learn more here).
Now that that's out of the way, it's important to study the latest info about Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP).
What have hedge funds been doing with Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP)?
At the end of the second quarter, a total of 24 of the hedge funds we track were long in this stock, a change of 41% from the first quarter. With hedgies' capital changing hands, there exists a few notable hedge fund managers who were upping their holdings considerably.
Out of the hedge funds we follow, Steven Cohen's SAC Capital Advisors had the biggest position in Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP), worth close to $30.8 million, comprising 0.2% of its total 13F portfolio. Coming in second is Phill Gross and Robert Atchinson of Adage Capital Management, with a $29.8 million position; 0.1% of its 13F portfolio is allocated to the company. Some other hedge funds with similar optimism include D. E. Shaw's D E Shaw, Jim Simons's Renaissance Technologies and Kevin C. Tang's Tang Capital Management.
Consequently, specific money managers were leading the bulls' herd. Baker Bros. Advisors, managed by Julian Baker and Felix Baker, created the biggest position in Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP). Baker Bros. Advisors had 334 million invested in the company at the end of the quarter. Howard Marks's Oaktree Capital Management also initiated a $136.1 million position during the quarter. The following funds were also among the new SLXP investors: Mark Kingdon's Kingdon Capital, Steven Cohen's SAC Capital Advisors, and Phill Gross and Robert Atchinson's Adage Capital Management.
How are insiders trading Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP)?
Insider buying is particularly usable when the primary stock in question has seen transactions within the past half-year. Over the latest 180-day time frame, Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).
We'll also review the relationship between both of these indicators in other stocks similar to Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP). These stocks are Ligand Pharmaceuticals Inc. (NASDAQ:LGND), Momenta Pharmaceuticals, Inc. (NASDAQ:MNTA), Actavis Inc (NYSE:ACT), Mylan Inc. (NASDAQ:MYL), and Akorn, Inc. (NASDAQ:AKRX). This group of stocks are the members of the drugs - generic industry and their market caps resemble SLXP's market cap.
# of Hedge Funds
# of Insiders Buying
# of Insiders Selling
Ligand Pharmaceuticals Inc. (NASDAQ:LGND)
Momenta Pharmaceuticals, Inc. (NASDAQ:MNTA)
Actavis Inc (NYSE:ACT)
Mylan Inc. (NASDAQ:MYL)
Akorn, Inc. (NASDAQ:AKRX)
Using the returns demonstrated by our research, average investors should always track hedge fund and insider trading activity, and Salix Pharmaceuticals, Ltd. (NASDAQ:SLXP) applies perfectly to this mantra.